Friday, 29 November 2013

The use of food crops to make biofuel for cars, the impact of which campaigners warn can be worse than fossil fuels, is set to increase by as much as 50% under EU proposals on Friday.

European nations have been negotiating a cap on the amount of biofuels produced from food crops that can contribute to renewable fuel targets because of concerns they may indirectly lead to deforestation and hunger.

The EU had proposed capping the use of such biofuels at 5% of total transport energy consumption – close to the current 4.7% share – later lifting that to 6% under lobbying from biofuel and agricultural sectors. But it will now be lifted even further to 7%.

A draft of a European council directive to be released today says: “The share of energy from biofuels produced from cereal and other starch rich crops, sugars and oil crops shall be no more than 7% of the final consumption of energy in transport in 2020.”

In 2009 the EU mandated a target of 10% of European fuels to come from renewable sources. Biofuels are the main way of reaching the target, and have been blended with conventional diesel fuel over the last few years.

Advocates for biofuels say they produce less greenhouse gases (GHGs) than fossil fuels. But environmental campaigners and many EU parliamentarians have raised concerns about the additional carbon contribution of indirect land use change (iLuc) caused by biofuels that come from food crops, known as “first-generation biofuels”.

The EU places regulations on the type of land that can be used to grow biofuels. This is designed to prevent the destruction of rainforests, peatlands and other important areas for biodiversity and carbon capture. But regulations fail to prevent the knock-on effects of the estimated €8.4bn in EU subsidies that drive demand for agricultural land and cause farmers to clear new landscapes in order to meet demand for food. Campaigners say iLuc could produce as much CO2 as between 14 and 19 million cars between 2011 and 2020.

Today’s proposals also water down the way in which iLuc factors are reported, and drop a target to mandate a target for the use of “advanced biofuels”, produced from waste and algae, which have a lower carbon footprint.

Energy bills could be cut by £50 a year in next week’s autumn statement by watering down “green levies” and moving them on to general taxation, under plans being discussed by ministers.

The changes will mean that energy companies’ spending on homes in fuel poverty in England will fall by 62% over this parliament, from £626m in 2010/11 to £237m in 2014/15. That would leave spending to help people insulate their homes at the lowest level in over a decade.

David Cameron has promised to “get rid of the green crap” on bills, according to newspaper reports, but the Guardian understands that ministers’ decisions will see green schemes diluted and funded by other means rather than axed entirely.

However, uncertainty over one scheme funded by the levies has already led to the scrapping of a £500,000 project to insulate 100 homes.

The only scheme that requires the big six energy firms to reduce customers’ energy bills, the £1.4bn-a-year energy companies obligation (ECO), will be watered-down by delaying the deadline for the companies’ targets.

In documents sent to the energy companies and seen by the Guardian, the government proposes extending the deadline from 2015 to 2017, without increasing the number of homes that companies must fit with insulation and new boilers.

Fears that the ECO would be scrapped entirely were unfounded, a Whitehall source told the Guardian. “Scaremongering about the ECO being scrapped is wide of the mark,” the source said.

Fracking is not going to reduce gas prices in the UK, according to the chairman of the UK’s leading shale gas company.

The statement by Lord Browne, one of the most powerful energy figures in Britain, contradicts claims by David Cameron and George Osborne that shale gas exploration could help curb soaring energy bills.

Browne added to the government’s ongoing troubles over energy policy by labelling nuclear power as “very, very expensive indeed” and describing the fact that more state subsidies are given to oil and gas than to renewable energy as “like running both the heating and the air conditioning at the same time”.

The former chief executive of BP, who now holds a senior government position as lead non-executive director, told an audience at the London School of Economics that climate change was “existentially important”, but that without gas the transition to a zero-carbon energy system would never happen.

However, Browne, who is the chairman of fracking company Cuadrilla, said: “I don’t know what the contribution of shale gas will be to the energy mix of the UK. We need to drill probably 10-12 wells and test them and it needs to be done as quickly as possible.”

“We are part of a well-connected European gas market and, unless it is a gigantic amount of gas, it is not going to have material impact on price,” he said.

The poor and elderly are going without heating after being pushed onto pre-payment meters, MPs said today.

They claim the Big Six energy firms are forcing people onto expensive meters as an alternative to disconnection.

But many customers are having to “self disconnect” because they cannot afford the rocketing gas and electricity bills, the Commons Energy and Climate Change committee has said.

The organisation Consumer Futures said that in 2011 the energy companies installed 384,835 in homes so it could recover unpaid bills.

But under the new tariff system consumers now have to pay annual standing charge of around £100 a year just to be stay connected even if they use very little gas.

Representatives from the Big Six firms – British Gas, EDF Energy, E.on, Scottish Power, SSE and Npower – told the committee they did not cut off residential customers over winter.

Instead they placed people on pre-payment meters.

Labour MP John Robertson, a member of the Energy and Climate Change select committee, said this often resulted in people being disconnected “by the back door”.

He told the Mirror: “When the Big Six were grilled in Parliament last month, they pledged not to pull the plug on vulnerable or elderly people struggling to pay their energy bills this winter.

“Since then we have heard that although energy suppliers are not disconnecting people directly, they do put hundreds of thousands of hard-up customers on pre-payment meters every year – so that they disconnect themselves.

A £4bn off-shore wind farm project has been axed by German ‘big six’ energy company RWE npower dealing an untimely blow to Britian’s renewable energy plans. The Atlantic Array of off-shore turbines was set to create thousands of jobs in the business electricity sector and provide power to around 1 million homes.RWE npower has said the economics of the project aren’t what they were made to be when the plan was initially drawn up – criticism that seems particularly pertinent given the German company’s claim that the Coalition Government treats environmental subsidies as a “political football”.

Tuesday, 26 November 2013

Ceres Power, a developer of residential hydrogen fuel cell systems, has been awarded a $1.5 million grant from the United Kingdom’s Department of Energy and Climate Change. The agency has been working to establish the United Kingdom as a world leader in low-carbon technologies and has put a strong focus on fuel cells and other such clean energy systems. While fuel cells remain quite popular in the transportation sector, these energy systems are beginning to gain more attention for their uses in the residential sector.

Friday, 22 November 2013

Energy regulator Ofgem announced yesterday (November 20) that it can now take direct action against ‘rogue’ brokers and other organisations that are marketing energy products or services to business customers, after being granted powers by Government under the Business Protection from Misleading Marketing Regulations (BPMMR).

Ofgem can seek undertakings from brokers and other organisations to stop misleading marketing activity or apply to court for an injunction to ensure that they are complying with the legislation. At present, Ofgem and the Office of Fair Trading have concurrent powers to enforce the regulations in the energy sector, after Ofgem made its case at the start of 2013 to BIS for it to have the power to enforce the BPMMRs.

Ofgem has also been developing an industry-wide code of practice for brokers that market energy to business, which will set out that brokers have to behave in a fair and transparent way to give businesses confidence when using their services. Ofgem will publish the code for consultation in December 2013.

A recent Ofgem survey found that around one third of businesses who had been approached by brokers did not consider that the broker had been upfront about the costs of their services, while previous Ofgem research has shown that businesses are concerned about cold calling, high-pressure sales tactics and the unprofessional behaviour of some brokers.

Thursday, 21 November 2013

Energy regulator Ofgem can now take direct action against brokers that mis-sell energy to business customers.

It has gained new powers to clamp down on ‘rogue’ brokers and other organisations that market products or services to business customers in a misleading way.

The energy regulator can stop brokers from using misleading marketing tactics and apply to court for an injunction to ensure they are complying with the legislation.

The new powers come after Ofgem’s latest research found around one third of small businesses in the UK didn’t believe brokers were upfront about the costs of their services. Previous research has also shown firms are concerned about cold calling, high pressure sales tactics and “unprofessional behaviour” of some brokers.

Philip Cullum, Consumer Partner, Ofgem said: “It’s crucial for our economy that Britain’s small businesses get a fair deal in the energy market. Getting help from a broker can assist in keeping bills down but business consumers need to feel confident that they know – and get – what they’re paying their broker for.

Ikea is now producing enough sustainable energy to supply a third of its global energy use and they will continue to produce more until they reach their impressive commitment of being carbon neutral by 2020.

To put their commitment into perspective; per wiki, as of October 2011, IKEA owns and operates 332 stores in 38 countries. If you’re planning a visit to one of their stores, wear your walking shoes because, yes, they are that huge. In fiscal year 2010, US$23.1 billion worth of goods were sold, a total that represented a 7.7 percent increase over 2009.

Wednesday, 20 November 2013

Search Engine giants Google are once again expanding their portfolio of renewable energy projects with news of a $80m investment into six solar energy facilities in the United States.Set to be located in California and Arizona, the commercial-scale solar sites will be developed with Recurrent Energy, a Stateside developer of photovoltaic cells and facilities and backed further by investment firm KKR.

Expected to be operational early in 2014, the combined output of the six sites is expected to total 106 megawatts – which Google says is enough to provide 17,000 homes and businesses with electricity.

Scrapping the government’s commitment to key measures to bring energy efficiency improvements to homes would cost tens of thousands of future UK jobs, research obtained by the Guardian has shown.The energy companies obligation Eco is likely to provide 46,000 jobs within the next two years, according to the Association for the Conservation of Energy, in an analysis using the government’s own estimates of employment.Most of those jobs – the majority of which are “blue collar” jobs in installing insulation, new boilers and construction projects – are now potentially at risk following government backtracking.If the scheme were abandoned, as some have called for, at least 30,000 of these jobs would be at risk.Scaling back the scheme, rather than abandoning it, would also result in significant job losses: halving the main requirements would cut employment by 10,000 people in the next year and an additional potential 7,500 future jobs would be foregone. Removing one of the main components of the scheme, which is aimed at people on low incomes, would see 28,000 jobs lost.Andrew Warren, director of the Association for the Conservation of Energy, said: “The vast majority of these jobs would be blue collared, and often semi-skilled. They would frequently be not even in SMEs, but in micro-businesses, precisely the companies that the government is relying upon to ensure economic recovery. Hammering these home improvement schemes makes no sense.”

Npower has sold its Electricity Plus and Gas Plus subsidiaries to Telecom Plus, the latter said in a statement this morning. In a separate statement, Telecom Plus announced its seen “significant acceleration” in organic growth, with adjusted profit before tax up 10.1 per cent to £13.7m. Growth and increased customer numbers were seen on the back of the Big Six energy price hikes, it said. (Release)

Telecom Plus, which already sells electricity, gas, broadband, and mobile and fixed-line telephone services via its Utility Warehouse brand, is paying a total of £218m to Npower. (Release)

The deal will see £196.5m paid now, in cash, with a further £21.5m deferred over three years. Telecom Plus is also signing a 20-year wholesale supply agreement.

It’ll also see Utility Warehouse gain over 770,000 customers. The group’s gross margin will immediately increase by 4.25 per cent upon completion of the acquisition.

Tuesday, 19 November 2013

Centrica is seeking a £6m refund from HM Revenue and Customs relating to the energy giant’s Peterborough gas-fired power station, following a legal dispute over business rates.

Centrica, one of the “Big Six” energy providers in the UK, is arguing that the rates have been set too high since 2005.

It says that during this period power plants have not been making a profit. If Centrica’s case, related to the Peterborough plant, is successful then it could see similar refunds for up to seven other gas-fired power stations owned by the group.

Business rates account for the largest slice of costs for gas plant operations and in the UK these stations are struggling to make a profit compared to cheaper, but less environmentally friendly, coal plants.

Electricity and heat generated from recycled food waste, wind turbines and solar panels will save UK businesses £33bn between 2010 and 2030 and cut carbon emissions significantly, a new study has revealed.

The study, commissioned by the specialist energy consultancy Utilyx, reveals that by 2030 on-site energy generation will contribute 14% of the UK’s energy needs – far exceeding the 9% generating capacity recorded in 2011.

On-site energy, also known as decentralised energy, is energy generated by low carbon or renewable technologies, close to where it will be consumed.

Combined heat and power (CHP) and energy from waste are predicted to deliver the greatest savings to UK businesses by 2030 (£20bn) but solar and tri-generation (the simultaneous creation of cooling, heat and power) are expected to grow the fastest.

The research was based upon a detailed forecast model which analysed the uptake of six major decentralised energy technologies across 23 sectors including retail, banking, manufacturing, utilities and construction.

The study, carried out by independent analyst firm Verdantix, found that decentralised energy will deliver total carbon emissions savings of 350 million tonnes by 2030.

The research was supported by interviews with decentralised energy stakeholders including UK based businesses with annual revenues each of at least £150m, decentralised energy technology service providers, energy finance firms, government and trade bodies.

Monday, 18 November 2013

Renewable electricity capacity has risen by 38 per cent in the past year, while renewables’ share of electricity was at an all time high of 15.5 per cent in 2Q13, according the figures released today (31 October) by DECC.

DECC’s Energy Trends and Prices Statistical Release also reveals that renewable electricity generation was 12.8TWh in 2Q13, an increase of 56 per cent on the same period in 2Q12. The use of bioenergy has also seen a significant increase, with a 58 per cent rise in generation in 2Q13 compared with the same period in 2012.

Other forms of renewable energy have also fared well in the past year, with a 29 per cent increase in hydroelectric generation. Electricity generated from onshore wind rose by 70 per cent, a figure attributed not only to increased capacity, but also to high wind speeds. At the end of 2Q13, onshore wind had the largest share of renewable capacity (36 per cent), followed by bioenergy (25 per cent) and offshore wind (18 per cent).

The increase in use of renewables coincides with a fall in oil production (down by 18.6 per cent) and gas production (down by nine per cent). The low carbon share of electricity generation by Major Power Producers rose by three percentage points in between 2Q12 and 2Q13 to 34 per cent.

Members of the public may rightly be worried about the price of energy in the UK and concerned about how they will pay bills this winter, but a new report has shown costs are actually lower than the average in Europe.

According to the latest data to be released by Europe’s Energy Portal, which is the European Union (EU) body that monitors prices across the region, the UK’s price per kilowatt of energy is below the continent’s average cost.

However, the report does not tell the full story as energy efficiency in the UK is poorer than in many European countries, so properties do not retain heat well at all.

Michael Zwanenburg, a senior energy consultant at the EU, stated that energy rates for UK households are somewhat below the average amount paid per kWh in other EU countries.

“Basically the weather impacts the rate of consumption. A cold winter would significantly increase the household’s energy bill,” he was quoted as saying by ITV News.

Danish people were found by the report to pay the most for their natural gas in Europe, with fuel costing residents in the nation €0.108 (£0.09) per kWh, compared to €0.061 in Germany, €0.079 in Italy and €0.044 in the UK.

However, for electricity, Denmark pays €0.295 per kilowatt of electricity, while this figure is €0.170 in the UK, €0.265 for Germany, €0.231 for Italy and €0.189 in Spain.

Friday, 15 November 2013

Shadow energy minister Tom Greatrex has challenged the government to clear up once and for all whether renewable energy schemes will be subject to the Prime Minister’s “green levy” review following conflicting signals from ministers.

Renewable energy companies were relieved earlier this week when Conservative energy minister Baroness Verma declared that “no one is talking about changing support for large-scale renewables or feed-in tariffs”, indicating that the renewables obligation and upcoming contract for difference schemes would not be cut as a result of the review.

Renewable energy trade associations also confirmed this week that they had received assurances from the Department of Energy and Climate Change that “between now and 2020, the support we give to low carbon electricity will increase year-on-year to £7.6bn – a tripling of the support for renewable energy”.

However, Conservative energy minister Michael Fallon had previously insisted that the government was looking at all “green levy” schemes as part of the review.

When asked by Labour MP Dr Alan Whitehead at Thursday’s energy statement in the House of Commons to clarify which schemes were under review, energy and climate change secretary Ed Davey failed to offer any assurance that renewables schemes would be exempted. “The honourable Gentleman, who is very knowledgeable in this area, will have to await the outcome of the review,” Davey replied. “It will be announced at the autumn statement or before. He and his colleagues will hear the results of the review at that time.”

The response prompted a letter from Greatrex to Davey calling on him to clarify precisely which schemes are being reviewed following the Prime Minister’s controversial pledge to “roll back” some “green levies”.

When you’re the city that never sleeps, it’s important to keep the lights on – but as well all know, leaving the lights on isn’t the epitome of energy efficiency. Which is why thew City of New York will be transitioning it’s street lights to more energy-friendly LEDs over the next four years.Speaking last week, New York mayor Michael Bloomberg outlined that a four-year timeframe for changing all of New York City’s staggering 250,000 streetlights to energy efficient LED bulbs.

As the light in the tea-time sky grows less, autumn begins to uncoil itself over the land like an intemperate vagabond. Today, in the air I can smell the scant trail of smoke from the fires lit in the hearths of homes that are trying to keep the cold outdoors – despite the spiralling costs of energy. This inclement weather leads me on cat’s paws to a winter that occurred, long ago during the Great Depression when I was a bairn and there was nowt to eat and nowt to heat. It was truly a time of discontent with more than 20 million people mired in enormous economic difficulties. The era was so desperate that I, along with other children from working class stock pinched coal from colliery slag heaps and hoped that those busted shards of fuel would burn the damp out of our dismal terraced houses.

Today, the living conditions of an average citizen are not as bleak as those that I experienced as a boy. However, for those who must contend with austerity on fixed wages or on a pension, the modern world is a harsh and unforgiving place. Moreover, this government and its support for big business over the ordinary consumer have pushed many economically vulnerable to the edge of the civilised state.

Perhaps one of the most distressing examples of corporate profit hubris is the increase in heating and electricity bills by four of the big six energy companies. This jump by almost 10% in the cost of heating one’s home will cause enormous hardship to the elderly in this country who are for the most part not wealthy and struggle to keep up with the cost of living.

This may be why the PM’s recent remedy to combat the chill of winter with a jumper, stung me as much as chilblains did in my boyhood. It clarified to me what I had already suspected that in Whitehall, there are few who have experienced the ordinary trials and tribulations of middle and working class life. One quarter of this country’s population has experienced fuel poverty, which means they have had to economise to keep their homes heated or, even worse, they have gone without food to keep the lights on in their houses. Whether the government wishes to acknowledge it or not this is a real crisis for too many people in this country. Yet MPs are more accustomed to listening to the concerns of corporate lobbyists for the energy industry.

It is not that our politicians don’t have solutions to the escalating cost of energy because each party has offered remedies. Some even make sense – like capping energy prices, taxing these companies or subsidising the cost of heating one’s home. The problem is that all of these proposals to cure the outrageous price of energy are for winters in the future. This is why I fear that this coming winter will be unnecessarily harsh on too many vulnerable people because it’s impossible to keep warm on promises of relief that can’t be burnt until 2015.

Thursday, 14 November 2013

EDF Energy was handed £2.99 million between April 29 and October to shut down turbines on the Fallago Rig wind farm, which is on land owned by the Duke of Roxburghe in Scottish Borders.

The “constraint payments”, which averaged around £500,000 per month, ultimately come from electricity bills and are given to wind farm companies for not producing energy during periods of high generation or low demand.

This usually happens when it is too windy, in order not to overload the National Grid, but can also occur when maintenance work on the Grid is being carried out.

The 48 – turbine development in the Lammermuir Hills started generated electricity in January but only completed testing and came fully online on May 17

Campaigners said the payments for not producing electricity – which spiked at more than £320,000 per day – demonstrated the consequences for consumers of Alex Salmond’s drive for wind energy north of the Border.

The first of a new generation of farm-scale wind turbines has been installed on a farm at Liskeard in Cornwall by Wetherby-based farm turbine specialist Earthmill.

The first Endurance X29 to be installed on UK soil, and also the first to be built in the UK, was commissioned last week and is now generating power for Matthew Rowe’s Great Tredinnick dairy farm, up to 500,000 kWh per year, the equivalent of the power consumption of 150 homes.

Earthmill, one of the UK’s only specialist farm-scale wind turbine installers and suppliers, is also one of a handful of authorised suppliers that can install the Endurance X29 in the UK. The 225kW unit was built by Endurance Wind Power at its new factory in Hartlebury near Kidderminster.

As the year draws to a close and a wintry chill sets in, it is inevitable that people’s minds will once again turn to the problem of expensive energy bills.

Recently in the firing line were senior executives from the ‘Big Six’ energy providers – E.ON, British Gas, npower, EDF, Scottish Power and SSE – who were questioned by MPs at an Energy and Climate Change Committee hearing about controversial price rises.

Almost half a million UK homes are now fitted with a solar panel array, according to new figures.

The Department of Energy and Climate Change (DECC) revealed last week that as of October 27, 478,431 homes across the UK have solar installations.

These installations generate a cumulative capacity of 1.72 gigawatts (GW) – with an average of 7.77 megawatts (MW) installed every week since September.

The Solar Trade Association (STA), the trade body for the solar industry, argues that these half a million homes are now less exposed to the energy bill increases that are affecting households across the country.

STA chief executive Paul Barwell said, “People who are fed up with their energy supplier could do no better than to switch to supplying themselves with solar power on their roof.”

The STA’s ambition is for 1m homes across the UK to have solar panels on their roofs. If current installation rates of around 100,000 systems per year are doubled, the STA estimates this could be achieved by 2015.

Tuesday, 12 November 2013

The energy bosses of all the major energy firms should follow the example of Centrica boss Sam Laidlaw and forgo their bonuses, Caroline Flint, the shadow energy secretary, has said .

She said: “They should all reflect on what they are being paid not just this year, but in previous years and future years”.

Flint said the energy market needed fixing, arguing that evidence showed that wholesale costs did not justify the recent price rises.

“Prices could have been lower than they are today”, she said. “At present we do not have a market we can trust. They generate energy. They are wholesalers and retailers. They sell it to themselves before they sell it to us”.

Flint again promised that during its proposed 20-month price freeze a Labour government would break up the big energy companies and create a market in which the country could be clearer about the true costs of energy.

Energy and climate change secretary Ed Davey has confirmed his desire to reduce the time it takes to switch energy suppliers from a “completely ludicrous” five weeks to an “ambitious” 24 hours. His comments came during the announcement of this year’s Annual Energy Statement on 31 October.

Faster switching without higher cost

Davey said consumers needed to be put “in control” of their bills and his speech outlined a package of measures that would “force” greater competition among energy suppliers. Davey recognised achieving 24 hour switching would not immediately be possible, but he assured companies would not be allowed to increase charges to consumers to cover the costs associated with speeding up the process. Davey urged all suppliers to meet with him so an agreement and a delivery plan can be reached.

Monday, 11 November 2013

The energy regulator is seeking powers that will allow it to act against Third Party Intermediaries (TPIs) who mislead non-domestic customers.

Better regulation

TPIs are organisations or individuals that give energy-related advice or help companies to procure energy or manage their energy needs.

Concerns have been raised that TPIs operating in the non-domestic market are not subject to sector-specific regulation.

At present the energy regulator Ofgem does not license TPIs. Instead, these companies have to follow general consumer protection rules, including those that relate to business customers, such as the Business Protection from Misleading Marketing Regulations (BPRs) 2008, which prohibits misleading advertising to businesses. The regulations are currently enforced by the Office of Fair Trading (OFT) and Trading Standards.

However, Ofgem is concerned that the OFT and Trading Standards may not view energy as a priority as these bodies have economy-wide remits. The regulator has applied for enforcement powers under the BPRs that would enable it to establish injunctions against entities that market energy contracts and services to businesses in a misleading manner. Ofgem confirmed on 11 October is aiming to gain these powers later this year.

The Electricity Storage Network has warned that delays in installing at least an additional 2GW of electricity storage by 2020 will result in costs of £100m a year for taxpayers and investors.

The alert came as DECC named the first two winners of its £20m energy storage competition with the ESN adding that failure to act would also cause a loss of value rising to £10bn a year by 2050.

It also said the UK’s installed electricity storage capacity is “currently less than half of what is required” to balance the onset of low carbon technologies onto the grid.

ESN director Anthony Price said: ““The funding prize for UK energy storage innovators is great news for the development companies who have been selected by DECC to demonstrate their technology at scale in the UK, yet these two early stage projects represent a combined capacity of less than 10MW.

“To stimulate the market, both for innovation and large scale implementation, government must set a target to achieve 2GW electricity storage by 2020 and support that with a market mechanism to drive innovation through to delivery.”

“The Energy Bill is seeking to attract £110bn of investment to bring about a once-in-a-generation transformation of our electricity market, yet the investment in a decarbonised power grid without adequate electricity storage will result in additional costs from network fees, curtailment and system balancing of the order of £100m a year.”

Sunday, 10 November 2013

Energy companies have allegedly cut tens of millions of pounds off their tax bills by exploiting a legal loophole, according to a joint investigation by the Independent on Sunday and non-profit group Corporate Watch.

UK Power Networks, Electricity North West and Scotia Gas Networks are all accused of taking advantage of the “quoted Eurobond exemption” to lower their taxes.

The report claims Scotia Gas Networks has saved £72.5 million, UK Power Networks has saved £38 million and Electricity North West has saved £30 million.

Under the scheme, the companies allegedly slashed their taxable profits, by piling up debts to their foreign shareholders.

A 20% ‘withholding tax’ automatically charged by HMRC on interest payments sent abroad, means such a scheme wouldn’t normally be particularly profitable.

However, the companies and their shareholders are accused of exploiting the ‘Eurobond exemption’, which allows foreign interest payments to go untaxed if loans were made through an offshore stock exchange. The report alleges the Big Six supplier SSE is also complicit in the scheme, having signed off on loans made to Scotia Gas Networks. SSE owns half of the firm.

Speaking on The Andrew Marr Show, the Liberal Democrat Chief Secretary to the Treasury Danny Alexander said: “My message to any company that is engaged in aggressive tax avoidance is to stop it.